Shoppers Drug Mart faces proposed class action for 'unethical corporate practices'

A former Shoppers Drug Mart franchise owner has filed a class-action lawsuit against the Canadian retail pharmacy chain and its parent company, Loblaw, alleging the companies imposed “unsafe and unethical” corporate practices on franchisee pharmacists to boost profits.

The complaint was filed in Ontario Superior Court last week and seeks to cover both franchise owners whose agreements have been terminated since 2014, as well as current franchise owners in Ontario.

It has not yet been certified or tested in court.

At the heart of the lawsuit is how corporate practices, such as setting medication review volume targets, reducing support staff hours and using other mandates to increase revenue, put Shoppers Drug Mart franchise owners, who are pharmacists, at an “irreparable disadvantage.” conflict of interest”.

“When you put policies in place that require an associate owner to breach their professional obligations at the risk of losing their franchise … you put them in a conflict of interest between their obligations to patients and their obligations to the business,” said Ali Haji, an attorney with the Ricketts Harris law firm who filed the class-action lawsuit that brought the proposal.

According to the court, the consequences of this scandal may be the suspension or cancellation of the pharmacist's license.

“It's pointless”: Loblaw

Loblaw and Shoppers Drug Mart have not yet filed a statement of defense in the case. But in an emailed statement, Loblaw spokesman Dave Bauer told CBC News “this case has no merit and we intend to vigorously defend it.”

The lawsuit follows a CBC News investigation that found some former Shoppers Drug Mart pharmacy employees used the company's MedsCheck drug review program in Ontario to induce employees to bill the government for patient counseling. definitely needed.

Although the chain's president denied that there were any targets for these services, dozens of internal memos from disgruntled pharmacists showed the chain had targets for these professional services and corporate management pressured owners to meet those numbers.

The Ontario College of Pharmacists has since said it is working with a legal team to explore its options after thousands of pharmacy workers came forward to share “deeply disturbing” stories of corporate pressure to perform billing services.

The previous owner “died” when he repossessed the franchise.

The lawsuit against former franchise owners such as Sivajanan Sivapalan, the lead plaintiff, alleges that his and others' franchises were canceled or not renewed for criticizing unethical practices.

According to the court filing, the buyers notified Sivapalan of his franchise in Beamsville, Ont. Discontinued in January 2023. The buyers did not give any reason for Sivapalan's decision.

Haji said of his client: “He was very depressed when this happened. It was a very difficult time in his life.”

“(Sivapalan) wanted to seek justice and see reparations for the pain and hardship many partners are going through.”

The lawsuit for the proposed class of current franchisees alleges that corporate practices, such as drug testing targets, prevent them from using their professional judgment as pharmacists and providing safe and effective patient care.

“Shoppers Drug Mart took no action to address the real risks to patient safety posed by corporate practices, resulting in franchisees' breach of professional and ethical obligations, and the resulting risk of regulatory scrutiny and sanction by the College of Pharmacists of Ontario,” reads the complaint.

“Instead, Shoppers Drug Mart actively implemented Corporate Practices to maximize profits.”

A Shoppers Drug Mart spokesperson previously told CBC News that decisions about providing professional services such as drug reviews should be made by the pharmacist using their own judgment.

“Our role is to help partner owners and their pharmacy teams deliver these services. This includes working with partners on an annual plan that fits the pharmacy's unique situation and the needs of patients in the community,” Catherine said in an earlier statement. Thomas.

In effect, the lawsuit alleges that the pharmacy chain is acting in violation of the intent of its franchise agreements because if the pharmacy owner faces sanctions from a provincial regulator as a result of corporate practices, it gives Buyers grounds to terminate the franchise. agreement with that franchise owner.

As a result, the proposed class action requires the court to find that the Buyers breached their franchise agreements with the class and seek damages for those breaches.